1. Field of the Invention
The present invention relates to financial transactions conducted with portable consumer devices such as payment cards and smart cards, and more particularly, relates to program management for such financial transactions.
2. Description of the Related Art
The misuse and abuse of transaction payment programs, such as credit card programs that use charge cards, smart cards, debit cards, and other portable consumer devices for payment of financial transactions, affects a wide variety of businesses involved in such transactions. As a result, compliance control is important for businesses involved in card-based payment programs, including merchants, payment acquirers, and issuers. Such payment programs typically subject transactions to a series of validity and authorization checks through online processing before any individual transaction is approved. A variety of special codes, encryption keys, and the like are often used to ensure that only valid cards are presented to a merchant. These safeguards are directed to prevent fraud, but are not of great advantage in managing payment programs to prevent misuse and abuse.
Misuse and abuse can occur on transactions with valid cards where the transaction itself may not be in compliance with payment program regulations for use. For example, a transaction may be for purchase of inappropriate or disallowed charges, or a transaction may exceed a user's authorized transaction limit, though the transaction might otherwise be valid. Such misuse and abuse of authorized cards continues to be a problem. As a result, businesses continue to suffer significant losses due to activity that constitutes misuse or abuse of authorized cards.
Non-compliant use of issued cards is such a significant problem that the U.S. government has mandated internal controls for government agencies with respect to government charge card payment programs administered by the agencies. Such charge card payment programs include programs for purchase card accounts and for travel card accounts. As a result, card issuers who wish to provide processing for financial transactions and participate in government-sponsored card-based purchasing programs must be mindful of such regulations. The internal controls necessary for such government-issued cards are described in Circular A-123 from the U.S. Government Office of Management and Budget (OMB) relating to the federal controlled-card program. Appendix B (revised February 2006) of the Circular A-123 publication is entitled “Improving the Management of Government Charge Card Program” and is directed to ensuring effective controls to mitigate the risk of abuse, misuse, and delinquency in such card accounts. Training, performance metrics, and data reporting are components of the program. Thus, concern over non-compliant use of payment cards extends from commercial enterprises to government agencies.
It should be apparent from the discussion above that here is a need for payment transaction processing that helps reduce the incidence of misuse and abuse in financial transaction payment programs that involve purchase cards, portable consumer devices, and the like. Embodiments of the present invention satisfy this need.